World Copper sells Zonia project for $18M

World Copper (TSXV: WCU) is divesting its interest in the Zonia copper oxide project to an unnamed arm’s-length party for cash consideration of C$26 million ($18 million). More details will be disclosed in future updates, the company said on Wednesday.

Located in the Walnut Grove mining district of Arizona, the Zonia project has been held under private ownership for almost 100 years and has undergone extensive historical exploration, metallurgical studies and mine development planning. A majority of the mineralized area at Zonia was pre-stripped during previous open-pit operations in the 1960-70s.

World Copper acquired the project in 2021 and has since produced a new resource estimate of almost 1 billion lb. in copper, of which 686 million lb. are in the indicated category. By comparison, the historical estimate had 510 million lb. of copper indicated.

A preliminary economic assessment was produced using the historical resource, outlining a potential 9-year heap-leach copper oxide mine with a post-tax net present value (discounted at 8%) of $192 million and a 29% internal rate of return.

World Copper previously indicated that it plans to advance the Zonia project through to feasibility and subsequently production. It has also been looking to grow the existing copper resource, which is based on drilling only 30% of the property, as well as reprocess the historically mined material to increase the project’s value.

The project’s new owner, according to World Copper, will be a European-based mining investment manager with two decades of experience in the industry.

The sale now leaves the company with the Escalones project in Chile, located 35 km east of Codelco’s El Teniente mine. A preliminary economic assessment in 2022 gave this project an after-tax NPV of $1.9 billion, a 46% IRR and a 2.2-year payback period.

World Copper ended Wednesday’s trading session 9% higher at C$0.06 a share, with a market capitalization of C$13.8 million ($9.7 million).